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When starting a new company, choosing a business entity is the most important decision that the founders must make. For most businesses with more than one founding member, forming as an LLC is often the best option for a number of reasons.
An LLC is an uncomplicated business structure that affords business owners legal protection by separating personal assets from business debts. Moreover, LLCs often enjoy a lower tax rate than corporations. Nevertheless, creating an LLC can get complicated depending on where you are based, with the formation process, filing fees, and continuing legal obligations differing from state to state.
Starting an LLC in Louisiana can be tricky as individual state parishes have different filing requirements. However, by following the procedure closely, you shouldn’t run into any serious issues.
To avoid a misstep in the filing process, follow these steps to start an LLC in Louisiana, and refer to the checklist at the bottom of the post to familiarize yourself with the legal and financial requirements for LLCs in the state.
Starting an LLC in Louisiana step-by-step
1. Select a name for your Louisiana LLC
Follow naming requirements
There are 2 major guidelines to follow when naming your LLC in the state of Louisiana:
- An LLC’s name must be distinguishable from the names of existing businesses on file with the Louisiana Secretary of State.
- An LLC’s name must contain one of the following phrases or abbreviations: “Limited Liability Company”, “L.L.C.”, or “L.C.”
Reserve your LLC name with the Louisiana Secretary of State
After selecting a name for your LLC, you should reserve it with the Louisiana Secretary of State in order to avoid the possibility of another business entity using the name before you are ready to file your LLC’s Articles of Organization.
First, confirm that the name is available for use in the state with the Louisiana Secretary of State’s Search for Louisiana Business Filings tool. If the name is available, you can reserve it for up to 60 days by filing a Name Reservation form online or by postal mail. The name reservation filing fee is $25 which can be paid by credit card, check, or money order.
2. Designate a registered agent
As in every U.S. state, forming an LLC in Louisiana requires the appointment of a registered agent service to handle state and federal legal documents and service of process on the business’s behalf.
The registered agent must either be a state resident or business entity with a street address in Louisiana OR if the individual or business is based out-of-state, they must have a business office in Louisiana.
3. File Articles of Organization
An LLC is formed in Louisiana through the filing of Articles of Organization Limited Liability Company with the Louisiana Secretary of State. The filing fee is $100, with the option of paying an extra $30 for 24-hour processing or $50 for 2-4 hour processing. Payment can be made by credit card, check, or money order.
LLCs based in the following parishes must file the articles online:
- East Baton Rouge
- St. Tammany
LLC’s based in parishes not included in the above list also have the option of filing the articles through the mail. If your Articles of Organization are filed by mail, you must include an Initial Report.
Your Louisiana LLC’s Articles of Organization must provide the following information:
- LLC name
- LLC principal office street address
- LLC’s purpose
- Registered agent’s name and address (online only)
- Preferred tax treatment (sole proprietor, corporation, or partnership) (online only)
- Whether the LLC is member or manager-managed (online only)
- LLC members and/or managers’ names and street addresses (online only)
- LLC business description (online only)
- Federal EIN (online only)
- One member, manager, or organizer’s e-signature (online) or organizers’ signatures (by mail)
An LLC formed outside of Louisiana intending to do business in the state must first register with the Louisiana Secretary of State.
Follow these steps to do business in Louisana as a foreign LLC:
- Comply with Louisiana LLC naming guidelines and confirm that your name is available for use in the state by checking the Louisiana Secretary of State’s Search for Louisiana Business Filings tool.
- Appoint a Louisiana registered agent.
- File an Application of Foreign Limited Liability Company with the Louisiana Secretary of State. Filing can be done online or through the mail (unless your LLC intends to do business in one of the parishes in the list in the above section where online filing is required) The filing fee is $150.
- When filing the application, you must include a Certificate of Good Standing from the LLC’s home state. The certificate must be dated from within 90 days of its filing with the Secretary of State.
4. Draft an operating agreement
Although not a legally mandated step for forming an LLC in Louisiana, drafting a comprehensive LLC operating agreement is strongly recommended for all nascent limited liability companies.
The operating agreement should do the following:
- Describe the LLC’s business structure
- Establish the individual responsibilities and obligations of LLC members
- Detail how the LLC will be run
Without an operating agreement clarifying the specific duties of its members, an LLC may face significant legal and operational difficulties.
5. Obtain an IRS Employer Identification Number (EIN)
All newly formed LLCs in the United States must acquire an Employer Identification Number (EIN) from the Internal Revenue Service (with the exception of single-member LLCs).
The nine-digit EIN is like a social security number for a business and is necessary to pay income tax, file tax returns, open business bank accounts, and perform many other important functions.
You can apply for an EIN online on the IRS website without paying a filing fee.
6. Fulfill your Louisiana LLC’s additional legal obligations
Once an LLC is registered, its members must devote attention to fulfilling legal requirements that apply for the duration of the company’s existence.
File Annual Reports
All LLCs doing business in Louisiana are required to file an Annual Report with the Secretary of State every year. The report is due every year by the anniversary of the LLC’s legal organization in Louisiana.
Annual reports must be filed online. The filing fee is $30.
Obtain business licenses and/or permits
An LLC doing business in Louisiana may be required to obtain one or more state or locally-issued business licenses, permits, or certifications depending on the nature of its business and its location.
Visit the Secretary of State’s Geauxbiz website for information on state licensing requirements, and contact a clerk or local government representative in the city or parish where your LLC is based for information on fulfilling local licensing requirements.
Register with the Louisiana Department of Revenue
Certain LLCs active in Louisiana must register with the Louisiana Department of Revenue to comply with state tax requirements. This includes LLCs that collect sales tax and those with employees.
Louisiana LLC checklist
A Louisiana LLC’s name must obey the following guidelines:
- Must be distinguishable from the names of existing business entities on file with the Louisiana Secretary of State.
- Must contain one of the following phrases or abbreviations: “Limited Liability Company”, “L.L.C.”, or “L.C.”
Formational documents and filing fees:
- Name Reservation form – $25 filing fee
- Articles of Organization Limited Liability Company – $100 filing fee
- Application of Foreign Limited Liability Company – $150 filing fee (foreign LLCs only)
- An LLC is created in Louisiana through the filing of Articles of Organization Limited Liability Company with the Louisiana Secretary of State.
Additional legal obligations:
- Filing Annual Reports – Required of all LLCs active in Louisiana
- Obtain state and/or local business licenses/permits – Required for certain types of LLCs
- Louisiana Department of Revenue registration – Required for certain types of LLCs